<B>Domestic Paper Stock Consumption Drops Sharply</B>

The continued problem with the domestic paper stock industry is magnified with the sharp fall in the consumption of recovered fiber. The American Forest and Paper Association reports the consumption level for the first eight months of the year stands at 23.856 million tons, a 4.9 percent decline from figures the same time last year. Consumption for August stands at 3.220 million tons.

The figures from the AFPA reflect what has been reported anecdotally over the past several months. With significant downtime being taken throughout North America, many paper stock dealers have had to shift tonnage to other avenues to keep the flow of material steady. At the same time, with many board mills taking significant downtime some collectors of bulk grades have been forced to either inventory material or landfill some grades due to low prices.

While consumption dropped, the inventory of recovered fiber at domestic mills surged 8.1 percent at the end of August to 1.098 million tons from the inventory level last August.

The inventory level also posted a strong 2.5 percent increase from the previous month’s level.

The recovered fiber industry was not the only area that saw a sharp increase in inventories. The AFPA also reports that market pulp inventories shot up 23.7 percent at the end of August from the same time last year. A further indicator of the soaring inventory levels was the jump from the previous month, 17.4 percent, as well as the number of days of supply on hand, which climbed from 21 days at the end of July to 25 days of supply on hand at the end of August.